[2022] KENET 774 (KLR)

Erdemann Property Limited v National Environment Management Authority & 4 others; Safaricom Staff Pension Scheme Registered Trustees & 4 others (Interested Parties) (Tribunal Appeal 15 of 2018) [2022] KENET 774 (KLR) (Environment and Land) (18 October 2022) (Ruling)

Neutral citation: [2022] KENET 774 (KLR)

Republic of Kenya

In the National Environment Tribunal - Nairobi

Environment and Land

Tribunal Appeal 15 of 2018

Mohamed S Balala, Chair, Christine Mwikali Kipsang, Vice Chair, Bahati Mwamuye, Waithaka Ngaruiya & Kariuki Muigua, Members

October 18, 2022

Between

Erdemann Property Limited

Appellant

and

National Environment Management Authority

1st Respondent

London Distillers (K) Limited

2nd Respondent

Galot Industries Limited

3rd Respondent

Machakos County Government

4th Respondent

Mavoko Water & Sewarage Co. Ltd

5th Respondent

and

Safaricom Staff Pension Scheme Registered Trustees

Interested Party

Everest Limited

Interested Party

Sunset Housing Limited

Interested Party

Fujian Installation Kenya Company Ltd

Interested Party

China Wu Yi Kenya Precast Company Limited

Interested Party

Ruling

1. This is a ruling on the 5th respondent’s bill of costs dated July 24, 2020 filed pursuant to a judgment of this tribunal delivered on December 5, 2019. While dismissing the appeal, the tribunal awarded costs to the respondents including the 5th respondent.

2. The appellant filed an appeal on September 21, 2018 in which it challenged the National Environment Management Authority’s (NEMA) failure to exercise its powers under the Environment Management and Co-ordination Act(EMCA) to compel the 2nd and 3rd respondents to cease and desist from disposing, depositing and/or dumping waste, refuse, debris and/or soil on their own properties LR No 12867/3, 12867/6, 12867/7 and 12867/8 (the suit properties)which are adjacent to the appellant’s properties known as LR No 12581/14, LR No 27317/2, LR No 128671 (the appellant’s properties).

3. The sole prayer sought against the 5th respondent was, “an order directing the 3rd, 4th and 5th respondents to monitor the 1st and 2nd respondents activities on the suit properties herein which activities are harmful and or hazardous to the environment.”

4. In its bill of costs, the 5th respondent prays to be awarded the sum of Kshs 959,204. 00 being the party and party bill of costs. Both the 5th respondent and the appellant filed submissions to the said bill of costs to support their respective arguments.

The 5th Respondent’s Submissions 5. The bill of costs is premised on schedule 11 of the Advocates Remuneration Orderand requires that where the value of the subject matter cannot be ascertained, the taxing officer ought to consider the nature, importance, complexity, value of the matter, time expended by the advocates and the number and importance of the documents prepared or perused without regard to the length of the documents.

6. According to the 5th respondent, the appellant’s properties are high valued and the activities complained about in the appeal do affect numerous people thus the value of the said properties ought to be considered while awarding the costs of the appeal. The 5th respondent cited the case of Premchand Raichand Ltd v Quarry Services of East Africa Ltd(No 3) 1972 EA 162 as cited in the case of Wambugu v Attorney General of Kenya [2013] eKLR in which it the court held that costs should not confine access to justice to the wealthy, a successful litigant ought to be reimbursed for the cost that he has to incur, among other considerations.

7. The 5th respondent further argued that there is no mathematical formula to be used by a taxing master and that the circumstances of a case must be considered as provided in the case of Simpon Motor Sales London Ltd v Hendon Corporation. There was a further submission that the tribunal has discretion to increase fees after considering the factors as set out in the case of Joreth Ltd v Kigano & Associates civil appeal No 66 of 1999 [2002] 1 EA 92.

8. As for the attendance costs, the 5th respondent argued that under paragraph 10(c) of schedule 11 of the Advocates Remuneration Order an advocate is entitled to attendance fees of Kshs 4,000 for the first day of hearing an Kshs 2,100 for each subsequent day thus the amounts claimed in paragraphs 48, 49 and 50 of the bill of costs should be awarded as prayed.

The Appellant’s Submissions 9. On its part, the appellant submitted that the 5th respondent had filed a notice of preliminary objection to challenge the jurisdiction of the tribunal but the same was dismissed and that was an affirmation that the appeal was not frivolous or vexatious. All the same the appeal did not raise any complex and the nature of the responsibility by counsel was quite ordinary.

10. The contribution of the 5th respondent was not immense as the said respondent only filed a single reply, a preliminary objection and called a single witness to defend the allegations of dumping. According to the appellant, neither the pleadings filed by all parties as well as the judgment of the tribunal can ascertain the value of the subject matter thus the instructions fees shall be subject to the taxing master’s discretion. Since the value of subject matter cannot be ascertained and the matter was not complicated, the appellant submitted that the taxing master can, pursuant to para 3 and 9 of schedule 11 of the Advocates Remuneration Orderaward the sum of Kshs 35,280/= but the figure can be reasonably increased upon taking consideration of the relevant factors.

11. The appellant relied on the case of Joreth Limited v Kigano & Associates [2002] eKLR where the court held that“The value of the subject matter of a suit for purposes of taxation of a bill of costs ought to be determined from the pleadings, judgment or settlement(if such be the case) but if the same is not so ascertainable the taxing officer is entitled to use his discretion to assess such instruction fee as he considers just, taking into account, among other matters, the nature and importance of the cause or matter the interest of the parties, the general conduct of the proceedings, any direction by the trial judge and all relevant circumstances.”

12. The appellant further submitted that there were no grounds whatsoever to justify instruction fees of the sum of Kshs 550,000/= as the bill contains ordinary material of day-to-day legal practice. This argument was supported by the holding in Republic v The Minister for Agriculture ex parte Samuel Muchiri W/Njuguna[2006] eKLR in which the court held that,“The complex elements in the proceedings which guide the exercise of the taxing officer’s discretion, must be specified cogently and with conviction. The nature of the forensic responsibility placed upon counsel, when they prosecute the substantive proceedings, must be described with specificity. If novelty is involved in the main proceedings, the nature of it must be identified and set out in a conscientious mode. If the conduct of the proceedings necessitated the deployment of a considerable amount of industry and was inordinately time-consuming, the details of such a situation must be set out in a clear manner. If large volumes of documentation had to be classified, assessed and simplified, the details of such initiative by counsel must be specifically indicated – apart, of course, from the need to show if such works have not already been provided for under a different head of costs.”

13. Finally on the question of the complexity of the matter, the appellant argued that the costs should only be for indemnification of the party but not for unjust enrichment which would punish an unsuccessful appellant in a suit of environmental challenge mounted in public interest.

14. On the expenditures of copies in items 6, 10, 17, 25, 29, 39, 54 and 55, schedule 11 paragraph 6 of the ARO, the same are not supported by any vouchers hence they should be taxed off the bill.

15. On attendances, the appellant submitted that items 48, 49 and 50 ought to be taxed in terms of Kshs 4,000. 00 for the first day of hearing and Kshs 2,100. 00 while VAT should be taxed off the bill as the same is not applicable to party and party bills of costs.

Analysis 16. The tribunal has considered the bill of costs, the submissions as well as the authorities annexed to the said submissions and we thank counsel for their industry. The only issue for determination is what amount is reasonable to be awarded to the 5th respondent as costs of the appeal.

17. The tribunal is guided by schedule 11 of the of the Advocates Remuneration Order (2014) (ARO) in considering a bill of costs filed by the parties. It is common ground that the appeal before the tribunal was based on a complaint by the appellant that the 1st and 2nd respondents were causing environmental degradation by dumping waste in violation of the law and the 3rd respondent had failed to act on the complaints and ensure observance of the law. There is no pecuniary value of the subject matter and none can be ascertained from the pleadings filed by the parties as well as the judgment of the tribunal on the matter.

18. Paragraph 3 of schedule 11 of the ARO provides that,“When taxing the costs consideration shall be given by the taxing officer to either the value of the subject-matter or, where the value of the subject matter cannot be determined, to the following criteria.(a)the nature and importance of the proceedings;(b)the complexity of the matter and the difficulty or novelty of the question raised;(c)the amount or value of the subject matter,(d)the time expended by the advocate(s),(e)The number and importance of the documents prepared or perused, without regard to length”

19. The appeal before the tribunal was not complex and there were no novel questions raised before the tribunal by any of the parties. The East Africa Court of Justice in the case of Alcon International Limited v Standard Chartered Bank and 2 others (reference No 1 of 2014), held that,“The over-arching principle to be discerned from all case law on the issue is that it is important to bear in mind that what should be allowed in taxing costs, is what is fair and reasonable in the circumstances of each particular case, so as to avoid, among others, the risks of confining access to justice to the wealthy.”

20. Having established that the value of the subject matter was not ascertainable and the appeal was not complex, the tribunal finds the instruction fees of Kshs 550,000. 00 and the getting up fees of Kshs 185,000. 00 being excessive. That notwithstanding, the submission by the appellant that the bill ought to be assessed at Kshs 35,280/= is also disallowed as the figure is too low and not commensurate to the work done by the counsel defending the matter. Having considered all the relevant matters in this appeal and noting that a high figure of instruction fees would confine access to justice to the wealthy while a very low figure would not offer reasonable indemnification to the party filing the bill, the tribunal shall tax off the instructions fees in a bid to achieve a reasonable remuneration for the advocate.

21. Items 3-42 and 56 of the bill of costs are taxed off and deemed to be part of the instruction fees.

22. As for the attendances, items 48, 49 and 50 of the bill of costs are taxed off to Kshs 2, 100 per attendance in accordance with schedule 11, paragraph 10 (c)(ii) of the ARO. Attendances - items 48, 49 and 50 are taxed off to Kshs 2,100. 00 per attendance. Total costs of attendances are as follows: item 44 - Kshs 4,000. 00 while items 45 to 53 are awarded at Kshs 2,100. 00 per item hence Kshs 4,000. 00 plus Kshs 18,900 = Kshs 22,900. 00;

23. It is trite law that disbursements must be proved by way of vouchers failure to which the same cannot be awarded. The 5th respondent has not filed any vouchers for the alleged disbursements thus paragraphs 54, 55, 57 and 58 are taxed off.

24. The 5th respondent also claimed VAT at 16% but does not elaborate the legal basis for the same. In Pyramid Motors Limited v Langata Gardens Limited[2015] eKLR, the court held that VAT is only allowed in a bill between an advocate and client but can be awarded in a party and party bill where the client proves that he or she had paid VAT to the advocate. No proof was produced in this case hence the VAT element is taxed off.

Orders 25. The party and party bill of costs dated July 24, 2020 is taxed off and awarded as follows:a.Instructions fees - Kshs 150,000. 00;b.Attendance costs – Kshs 22,900. 00

DATED AND DELIVERED AT NAIROBI, THIS 18TH DAY OF OCTOBER 2022. Mohammed Balala …………………………………………………………………ChairpersonChristine Kipsang………….……………………………………….…………Vice ChairpersonBahati Mwamuye…………….………………………………………………………...MemberWaithaka Ngaruiya………………….………………………………………………....MemberKariuki Muigua…………..………………………………………………………………Member